New York Department of Financial Services Director: Federal legislation on cryptocurrencies is welcome, but states should retain existing regulatory functions

Adrienne Harris, director of the New York Department of Financial Services (NYDFS), said at a digital asset conference in Manhattan that federal legislation for cryptocurrencies is welcome, but she insisted that states should retain their existing functions to regulate digital assets. She said that states have been able to act faster, and the conventional wisdom that allowing states to regulate digital assets could create a "race to the bottom" in terms of regulatory oversight has not been borne out. Harris said: "We are probably more eager than anyone to have a federal partner and see federal legislation and regulation. I think it's very important to pass legislation and develop regulations, but it's still important for states to play a role." She is "optimistic" that the House and Senate may soon pass legislation, and she said that the NYDFS has talked to both parties in the House and Senate over the past few years. Harris noted that New York's BitLicense is nearly a decade old and has evolved over the years, but the regulator's view on it has remained the same, "I don't think our approach has evolved that much. Our approach has always been how to protect consumers and the market while promoting innovation. So that means you have to keep up with the pace of the industry, but also keep the pace and keep the balance." In addition, she mentioned that NYDFS has one of the largest crypto departments in the world, with 60 full-time employees focused on the crypto industry. Since the launch of the BitLicense, the public's view of it has also become more accepting, and she called the change "gratifying." Even federal lawmakers have used the BitLicense as an example. (CoinDesk)